How To Make Real Innovation Happen At Your In-House Lab

In-house labs. Incubators. Skunkworks. Intrapreneurship. Call it what you will, but these small factions of staff fast-tracking innovative products and services have been around since 1943, when Lockheed tasked a team with building a jet fighter prototype in just 180 days.

That original "Skonk Works" has since spawned the cutting edge likes of Apple’s entire Macintosh division (originally dubbed "the pirates" by Jobs) to 3M’s Post-it notes. Now that companies such as Google and HP are making it a regular practice to encourage their best and brightest to take time away from regular tasks in order to pursue their brainiest ideas, in-house incubators are becoming de rigueur for companies to stay competitive and attract and retain talented innovators.

Mark Parker and company at Nike have bought in to intrapreneurship in a big way, going so far as to set up "secret" facilities, research labs, and training centers in order to give staff the stealth space to keep delivering new products like its Fuel Band.

Keeping these teams and their work relatively hush-hush is great for eliminating distractions while simultaneously upping the cachet of the product leading up to launch. However, these intrapreneurs still have to make them work every day. How do they do it? Fast Company spoke to several execs who are elbow deep in the daily operations of in-house labs. Here are some of their best practices.

Some other quick tips for successful skunkworks from PGi:Top-secret isn’t always essential.
Successful in-house innovation requires transparency, especially if you value the user experience. By bringing select customers and employees into the innovation process, you can foster ownership and pride in the products and ultimately drive employee satisfaction, as well as customer loyalty.

Constraints aren’t a bad thing.
Sometimes prioritization is necessary to stay focused on making the right innovations for the company and to ensure that the end-product, however innovative in the idea stage, has legs in the real world.

Bring in your friends JED and JEP.
That’s "just enough documentation" and "just enough process" to protect your in-house lab against producing a non-commercially viable product or getting stuck so far in the weeds that you miss the market opportunity.

Shorten the "yes" chain.
Companies are constantly trying to shorten the innovation cycle to more quickly bring products to market and close business faster, so a successful in-house lab should have a short, yet effective, "yes" chain to the top decision makers.

Focus First, Iterate Later
Asking customers for feedback is a good thing, Scott Schemmel, vice president Global IT for PGi, but it’s not the only thing that sparks new ideas. Remember when you used to have to talk to an operator before being put through to a conference call? It seemed like a big improvement when all you had to do was enter a passcode. But it never occurred to customers to ask for a simpler solution, even though Schemmel says, "Our customers are [one] of our greatest creative assets." Despite the company’s support of synchronous collaboration, PGi’s in-house lab team took over. The result: iMeet, a cloud-based virtual meeting tool that works with a one-click sign in.

Schemmel says PGi’s culture has always supported intrapreneurship from the top down. Though they don’t subscribe to Google’s 20 percent policy, the in house lab is just separate enough from the main activity to be agile and unburdened by having to hyperscale a commercial product out of the gate. Once the concept gels, its trotted out for feedback. "We are the top users of our products," Schemmel asserts. "We then reach out to customers to get their feedback." And the iterations begin.

Separate, but Stay ConnectedTagged, the social discovery network for meeting new people that has over 330 million members, started Tagged Labs to encourage intrapreneurship. Sidewalk, an app that alerts users to happenings in their city (and friends hanging out there too), is the first project to come from the dedicated 15-person team.

Tagged’s cofounder and CEO Greg Tseng says that the reason they created the Labs was to address opportunities, especially in mobile, that went beyond the core business of social discovery.

Though it’s been challenging to other staffers to have a small group of people working on "the new cool thing," 8-year old Tagged and upstart Sidewalk were at completely different stages of development and needed separate focuses. "We struggled with how much help does the rest of the company give to Sidewalk," Tseng admits.

In the end, they found a balance between having the established business provide services like marketing and Tagged’s catered lunches and dinners—helpful for when everyone hunkered down prior to launch. Drawing a paycheck helped, too. "Give the team space both time and space. The best ideas and iterations come from the bottom up."

Point the Way, Provide Perks
Gamification software provider Bunchball implemented Bunchball Labs last September with the goal to quantify how gamification drives real-world business performance by studying the data. Though most businesses rely on existing staff to fill out a skunkworks team, Joe Fisher, vice president of products says he hired the four people in Bunchball Labs from "the wild."

"I wasn’t specifically looking for engineers," Fisher says, just "folks who loved to explore and perform archeology." A love of math, statistics and putting data sets together needed to coexist with a creative side.

These qualifications are important because, while the team wasn’t sequestered in a cave in New Mexico, they are separated from Bunchball’s engineering team. The engineers need to launch new releases every two months, he says. The Labs team is unfettered from regular requests to write code so they can focus on the larger vision of the company. "They are not responsible for launching anything," Fisher says but instead comb the data from billions of user actions for trends over weeks and months.

His team needs to be really comfortable working on such a scale, he says, with only biweekly meetings to reinforce the grand vision. To grease their wheels of creativity, Fisher says Bunchball’s perks are "free flowing," meaning you’ll find one of the chief scientists tapping the Kegerator after hours or others taking a power snooze in the nap room. So far, he says it’s working. The analytics offering in the 5.0 release of Nitro Studio was a direct result of the data points the lab worked on, and there’ll be more to come later this year.